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Investing.com - DA Davidson has reiterated its Neutral rating and $39.00 price target on The Simply Good Foods Group (NASDAQ:SMPL) following the company’s fourth-quarter 2025 results. The company, currently valued at $2.1 billion, has maintained strong financial health with an InvestingPro Overall Score of "GREAT."
The company’s quarterly performance fell short of both the analyst firm’s expectations and consensus estimates. Initial guidance for fiscal year 2026 also disappointed, suggesting a third consecutive year of below-algorithm organic top-line growth. Despite challenges, the company maintains healthy fundamentals with a current ratio of 3.95x and operates with moderate debt levels.
DA Davidson had previously anticipated that fiscal year 2027 might mark a return to algorithm growth as Simply Good Foods worked through the process of rightsizing its Atkins business line. However, the firm now expresses concern about this outlook due to the accelerating deceleration of the company’s OWYN brand.
The analyst firm expects the stock to trade lower following the earnings release, pending additional information from the company’s earnings call regarding fiscal year 2026 delivery projections and future plans for the OWYN brand.
DA Davidson noted that Simply Good Foods is currently trading at approximately 9.0 times EBITDA, a valuation point they consider relevant to investors.
In other recent news, Simply Good Foods Co. reported its fourth-quarter earnings for 2025, showing a mixed financial performance. The company posted earnings per share of $0.46, which fell short of the expected $0.48, resulting in a 4.17% negative surprise. Despite this, Simply Good Foods managed to slightly exceed revenue forecasts. Additionally, Bernstein SocGen Group has adjusted its price target for Simply Good Foods, lowering it from $42.00 to $28.00, while maintaining an Outperform rating. The decision was influenced by ongoing challenges at the company’s Atkins brand and a temporary quality issue with OWYN. However, Simply Good Foods continues to deliver 3% organic sales growth. These developments reflect the complexities the company is navigating in the current market.
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